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Paulson pushes to blame "savings glut" by Jerome a Paris on January 3rd, 2009
We now see the second part of the strategy to push the blame somewhere else, ie on China and Germany: it's not the borrowers, and it's not the financiers either who are to blame: they were "forced" to deal with the surpluses of the countries that save more than they should, and so much money put in their highly competitive hands brought financial returns down and pushed them to seek riskier pastures to use that money. So they misallocated funds, and blew them, only because they had too much because the stupid Chinene and Saudis just have too much money!


This not only pushes the blame away from the policies of the neolibs (income concentration for the very rich, leading to income stagnation for everybody else, hidden from view by cheap and plentiful debt allowing consumption to continue), it also provides a convenient reason not to re-regulate the financial world. It's NOt the financier' fault, don't blame them! (*)


I expect this concept to be massively pushed in the coming months, with all the accompanying China- and Germany-bashing. The Germany-bashing is already in ful swing, as it includes the added bonus of an Europe.Is.Doomed angle... see all the articles about how Germany is pushing the whole world into a depression by refusing to be bamboozled into a massive spending spree - how Germany diplomacy is failing, and how Merkel's star is fading, and the mocking, snickering tones about the Germans who thought they were being prudent by not joining the fun and now are suffering as much as those that had fun while it lasted.

By laying out pros and cons we risk inducing people to join the debate, and losing control of a process that only we fully understand. - Alan Greenspan
by Carrie (migeru at eurotrib dot com) on Tue Jun 8th, 2010 at 03:22:33 PM EST
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